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Senate Should Reject Corrupt Payback to Wall Street

Statement of Bartlett Naylor, Financial Policy Advocate, Public Citizen’s Congress Watch Division

WASHINGTON - Note: This week, the U.S. Senate will debate S. 2155, the first major Wall Street deregulation package it has considered since passage in 2010 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. A vote is expected on Thursday. Public Citizen sent a letter (PDF) to the Senate voicing strong opposition.

Ten years after a financial crash that cost millions of Americans their homes, jobs and savings, the U.S. Senate is moving forward with a measure to roll back safeguards against Wall Street recklessness. Disguised as a community banking bill, this misguided legislation eliminates safeguards for 25 of the 38 largest banks, a sector that received some $50 billion in bailout funds. The bill also slashes consumer protections meant to fight racially discriminatory lending practices and protect purchasers of manufactured housing.

This legislation comes in the wake of congressional Republicans sanctioning forced arbitration rip-off clauses in consumer financial contracts, passing tax giveaways for millionaires, billionaires and big corporations, and putting Wall Street lapdog Mick Mulvaney in charge of the U.S. Consumer Financial Protection Bureau. How many more corrupt paybacks at the expense of consumers does Wall Street need?

It is especially troubling that this deregulatory package has the support of about a dozen Senate Democrats – an ugly reflection of Wall Street’s political clout in both parties, purchased through billions in political spending over many decades. As the Democratic Party’s former vice presidential nominee, U.S. Sen. Tim Kaine (D-Va.) cosponsoring the bill shows that too many Democratic politicians remain far too close to the financial sector. Even more concerning are press reports that the bill’s supporters could benefit financially from its passage.

After the recent scandals at Wells Fargo, Equifax and other financial institutions, the Senate should be fighting for tougher Wall Street rules, not rolling them back to pay back wealthy corporate donors.

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Public Citizen is a national, nonprofit consumer advocacy organization founded in 1971 to represent consumer interests in Congress, the executive branch and the courts.

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